Directors’ bonuses rise by 34 per cent

Bonus payments boosted the earnings of UK company directors by 13 per cent
in 2001, according to research by the Institute of Management.

The survey shows that average bonuses rose from £20,856 to £28,071 in the 12
months to January 2001 – a rise of 34 per cent.

This jump in directors’ pay follows a 1.2 per cent drop in 1999.

The research shows that the average annual total earnings of company
directors is £121,011 and the average age is 50.

Mary Chapman, director-general of the Institute of Management, said,
"This big rise in bonus payments reveals the extent of economic buoyancy
and business confidence in the UK during the period covered by the research.

Directors in the food, drink and tobacco industries enjoyed the biggest
earnings rise at 20.4 per cent, with directors of engineering companies a close
second.

It also shows managers below the rank of director received an average increase
in overall income of 5.5 per cent. There were significant regional variations
in managers’ income, with those in East Anglia benefiting from an increase of
10.5 per cent compared with managers in the North receiving less than 4 per
cent.

There has been a steep rise in the number of companies experiencing problems
in recruiting and retaining managers according to the survey. More than a third
of the 421 companies surveyed have had problems with recruitment, compared with
23 per cent the previous year.